Rabu, September 13, 2006

Economic Depression and Lack of Security Brings down Real estates and Land plots in Iraq

Real estate agents says : the reason behind the growth of this problem is turning the rich and big companies specialized in real estate investment to the neighboring countries because it is more secure , profitable and successful for their big projects as well as maintaining their capitals ; while here , depression seems to affect almost every aspect in life .

Big investors are too afraid to stay in Iraq especially after hearing the terrible incidents that some of their colleges had undergone like the abduction of some by organized crime gangs and were only released after paying thousands or perhaps millions of USD as ransom. Another incident is what happened to the owner of one of the biggest real estate investment companies in Baghdad when armed men dressed in uniforms broke into his office.

Such violent deeds against investors had terribly affected the commercial and investing situation in Iraq ; This caused a great recession in real estate market and brought down the prices of real estates and land plots to about 50% in different areas in the Iraqi capital, met by a high demand on renting houses and rising rents because of the increasing numbers of those who were forced to migrate or move from their places in different areas from Baghdad and other governorates. Mustafa Saad, one of the real estate agents in Al-Mansoor region, said "Insecurity and economic depression has affected the sales of land plots and real estates which made the capitals and their investors escape to the neighboring countries. Also, prices of construction materials have become twice as more as they were last year.

Mustafa added : land plots' prices has went down a lot ; in Al-Mansoor region , for instance , the price of a meter used to be one million I.D. but now it is about 650 thousand I.D., as for the price of a big house of 2500 meter in area at Al-Ghazalia region it used to be 250 million I.D. but now it is about 100 million I.D. and so is the case in other regions .Mean while , a lot of Iraqi capitals are invested in neighboring countries like Amman , for example , where big investors has chosen many regions to build residential compounds and luxurious apartments as well as establishing gigantic commercial complexes.

Also, in Damascus Iraqi investors had built residential compounds that pour out large sums of money especially in seasons of tourism in summer.

Saad points:" We did not even sell one house through our office since a year now because of the low purchase capacity of citizens and the leaving of investors. But when it comes to renting houses and apartments there is a great demand on that especially from families who has migrated or deserted their living places.

" Real estate agents and big investors hopes that their sector would witness some revival like the one it had right after the fall of the previous regime when land plots and real estate sale rates went high because of the governmental encouragement to investing offices, prohibition of insured loans to buy lands and building or investing them.

Also, taking part of profits for the State paid by phases with guarantees undertaken by the investor through some encouraging facilities before this sector falls down and becomes to hard to be amended.(Source)AlSabah